Feature

Insurers vs. health-care reform

The health-insurance industry group AHIP issues a warning about health-care reform. Is it credible?

The health-insurance lobby just “launched a surgical strike” against the Democrats’ “best hope for health reform,” said NBC Washington. A new report from America’s Health Insurance Plans (AHIP) shows how Sen. Max Baucus’ health bill, up for vote in the Finance Committee on Tuesday, would drive up the cost of care for families and businesses. And so ends AHIP's public support for and “behind-the-scenes lobbying campaign” against health-care reform.

“Let me get this right,” said Josh Marshall in Talking Points Memo. The insurance lobby hires an accounting firm that says insurance reform will drive up costs, and “this is news?” Why does the news media fall for this “rent-a-research”?

Well, the AHIP report is right about at least one big thing, said The Washington Times in an editorial. The Baucus bill has a weak individual mandate—the meager $750 fine per adult for not carrying insurance gives the young and healthy a strong incentive to “game the system,” buying insurance only when sick and eating the fine. This will make it more expensive for those who “play by the rules,” and that isn’t fair.

It’s also not entirely accurate, said Jonathan Cohn in The New Republic. The analysis of the Baucus bill, by PriceWaterhouseCoopers, is right that the weak individual mandate spells “trouble,” but it also “leaves out some pretty big things,” like the lack of subsidies to help poorer people buy in. Other “fishiness” from the study includes unexplained “strange assumptions” about insurers raising rates and businesses buying the costlier insurance.

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